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Appraising expensive homes

A K

Elite Member
Joined
Jul 31, 2013
Professional Status
Certified Residential Appraiser
State
Maryland
About 80% of my assignments is $1 to $3 million. 10% of assignments less than $1 million and 10% of assignments more $3 million. I might get one or two per year over $10 million.

The premium on the $2 million per claim coverage is not that much more than $1 million per claim coverage but the deductible is higher which is fine. I don't expect any claims.
 
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Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
I don't expect any claims.
You won't get sued over anything you'd think a serious potential threat. It will be an assignment so mundane you are puzzled as what the complaint is.
 

A K

Elite Member
Joined
Jul 31, 2013
Professional Status
Certified Residential Appraiser
State
Maryland
You won't get sued over anything you'd think a serious potential threat. It will be an assignment so mundane you are puzzled as what the complaint is.

I don't know. I try to do a good job and I don't really worry about that.
 

Fernando

Thread Starter
Senior Member
Joined
Nov 7, 2016
Professional Status
Certified Residential Appraiser
State
California
About 80% of my assignments is $1 to $3 million. 10% of assignments less than $1 million and 10% of assignments more $3 million. I might get one or two per year over $10 million.

The premium on the $2 million per claim coverage is not that much more than $1 million per claim coverage but the deductible is higher which is fine. I don't expect any claims.
Is your specialty in high end homes? I didn't know so many homes in your area have values over $1 million.
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
I don't know. I try to do a good job and I don't really worry about that.
Me too...but I still got sued over a report that I prepared for a bank 4 days after the bank closed the deal with the buyer...yet somehow they claimed that they "relied" upon my report that didn't even exist. I actually had the deed in the report. However, it backfired on them when they claimed the statutes of limitations should be tolled. The report was six years old at this point. The court pointed out that if they "relied" upon my report, then the SOL could not be tolled because they have a due diligence requirement to investigate their claim of suspecting it to be flawed. But they appealed to the federal courts in St. Louis and we flew my lawyer to St. Louis to plead our case before they affirmed the lower court decision.
 

A K

Elite Member
Joined
Jul 31, 2013
Professional Status
Certified Residential Appraiser
State
Maryland
Me too...but I still got sued over a report that I prepared for a bank 4 days after the bank closed the deal with the buyer...yet somehow they claimed that they "relied" upon my report that didn't even exist. I actually had the deed in the report. However, it backfired on them when they claimed the statutes of limitations should be tolled. The report was six years old at this point. The court pointed out that if they "relied" upon my report, then the SOL could not be tolled because they have a due diligence requirement to investigate their claim of suspecting it to be flawed. But they appealed to the federal courts in St. Louis and we flew my lawyer to St. Louis to plead our case before they affirmed the lower court decision.

I don't know. I try to do a good job and believe that my reports will hold up in court. I will worry about getting sued when it happens. I'm not going through my career in fear of being sued.
 

nottrav

Senior Member
Joined
May 2, 2011
Professional Status
Licensed Appraiser
State
California
That's true but some jumbo loans over a million dollars are becoming more common here.

What type of report do you do these jumbos over a mill on? Narrative? scratch paper? If I know you, you’re more than willing to show an example to help others right?
 
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glenn walker

Elite Member
Joined
Oct 11, 2006
Professional Status
Certified Residential Appraiser
State
California
In SO CA Los Angeles-Orange Counties a Million dollar home, is often a 1,200 to 1,800 Sq.Ft. single story on a 7,000 Sq.Ft. lot , not complex and by the coast and beaches it may be 900 Sq.Ft. Bungalow, so not like lower costs States where a million dollar home may be a 4,000 to 6,000 Sq.Ft. home may be a moster and a hard assignemts. In CA even Mr-F can do a million dollar home.
 

Fernando

Thread Starter
Senior Member
Joined
Nov 7, 2016
Professional Status
Certified Residential Appraiser
State
California
In SO CA Los Angeles-Orange Counties a Million dollar home, is often a 1,200 to 1,800 Sq.Ft. single story on a 7,000 Sq.Ft. lot , not complex and by the coast and beaches it may be 900 Sq.Ft. Bungalow, so not like lower costs States where a million dollar home may be a 4,000 to 6,000 Sq.Ft. home may be a moster and a hard assignemts. In CA even Mr-F can do a million dollar home.
On average my appraised value is about $1,200,000 and it's about 1,300 sf so you can see that many homes can easily go over $2,500,000.
Some AMCs think these $1,000,000 homes worth an extra premium which I don't mind. I would say if homes under $900,000 are challenging since they're fixer uppers and I would avoid appraising them because of necessity to figure out cost to fix.
 

TMG

Member
Joined
Jul 28, 2007
Professional Status
Certified Residential Appraiser
State
California
E & O would not be liable for the entire appraised value, just the error amount.....no?

i.e. Say your appraised value was found to be $250k high, E & O would pay that, not the entire appraised value like $2.5m or whatever.
 
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